3 falling FTSE 100 shares to buy in August?
We’ve seen a good few FTSE 100 ups and downs this week. That’s partly due to the number of companies reporting results, and my first pick is one of those.
Intertek (LSE: ITRK) delivered first-half results Friday, and the share price fell 9% in early trading, before regaining a couple of percent.
But I don’t see much negative news from the quality assurance firm. There is a small decline in revenue, which fell a very modest 1%. That’s at actual currency exchange rates, and at constant rates we see a 4.8% gain.
Despite that dip, chief executive André Lacroix said: “The Group is on track to deliver a strong 2021 with robust like-for-like revenue growth, year on year margin progression and a strong free cashflow performance.”
Free cash flow dropped in the first half, by 13.6%, and that’s the only other negative I can see. But it’s been an unusual half as we still struggle to shake off Covid-19. And the rest of the figures look good to me. Pre-tax profit is up 23% (even at actual rates), and net debt tumbled by 33%.
I think there’s a risk with any company offering business services when we face economic fragility. But, overall, I’m considering buying Intertek in August.
FTSE 100 turnaround?
Informa (LSE: INF) is among the FTSE 100’s biggest daily falls on Friday. The business services company suffered during lockdown. And its ability to run conferences and exhibitions still largely eludes the business.
As a result, the Informa share price is still down 40% over the past two years, while the Footsie has recovered to a more modest 5% decline. But do I think that makes Informa a good buy now? And will I put it on my August watchlist?
Last time I looked, I decided to hold back from Informa. We had no real idea when Covid restrictions would end, or what would happen afterwards. But three months on, we’re now past so-called Freedom Day. And, fingers crossed, coronavirus cases are not so far showing the massive increases many feared. Informa is still very risky, but I think we could have better clarity by the end of August. This is another I’m watching.
Bricks and internet
Next (LSE: NXT) has come out of the pandemic strongly. It’s falling Friday like the other two. But the shares are up 30% over the past two years, easily beating the FTSE 100. Is bricks and mortar fashion retail regaining some lost popularity? Boohoo is set to start selling some of its Debenhams brands in retail stores in the Middle East. It seems plenty of people do like to browse in stores and properly inspect the goods.
Next has long been a success in internet trading anyway. Online sales accounted for 56% of the total in the first half of 2021. Admittedly, that was during Covid closure. But it does show Next’s capacity. The firm said on 21 July that “sales during the last eleven weeks have been materially ahead of our expectations and, as a result, we are increasing our profit guidance for the full year.“
Next shares might be looking a bit toppy. And we could see some profit-taking in the near term. But the stock remains on my August candidate’s list.
Alan Oscroft owns shares of boohoo group. The Fintech Zoom UK owns shares of and has recommended Next. The Fintech Zoom UK has recommended Intertek and boohoo group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Fintech Zoom we believe that considering a diverse range of insights makes us better investors.